Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 / Notices 11891 

28 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3See Cboe Global Markets, U.S. Equities Market 

Volume Summary, Month-to-Date (January 26, 

2024), available at https://www.cboe.com/us/ 

equities/market_statistics/. 

4See BYX Equities Fee Schedule, Standard Rates. 

5 Id. 

the purposes of the Act. If the 

Commission takes such action, the 

Commission will institute proceedings 

to determine whether the proposed rule 

change should be approved or 

disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

comment form (https://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

CboeBZX–2024–011 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street NE, 

Washington, DC 20549–1090. 

All submissions should refer to file 

number SR–CboeBZX–2024–011. This 

file number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

internet website (https://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. Copies of the filing also 

will be available for inspection and 

copying at the principal office of the 

Exchange. Do not include personal 

identifiable information in submissions; 

you should submit only information 

that you wish to make available 

publicly. We may redact in part or 

withhold entirely from publication 

submitted material that is obscene or 

subject to copyright protection. All 

submissions should refer to file number 

SR–CboeBZX–2024–011 and should be 

submitted on or before March 7, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.28

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–03097 Filed 2–14–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–99508; File No. SR– 

CboeBYX–2024–005] 

Self-Regulatory Organizations; Cboe 

BYX Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change To Amend its 

Fee Schedule Regarding Periodic 

Auctions 

February 9, 2024. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on February 

1, 2024, Cboe BYX Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘BYX’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the Exchange. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

Cboe BYX Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘BYX’’) proposes to 

amend its Fee Schedule. The text of the 

proposed rule change is provided in 

Exhibit 5. 

The text of the proposed rule change 

is also available on the Exchange’s 

website (http://markets.cboe.com/us/ 

equities/regulation/rule_filings/BYX/), 

at the Exchange’s Office of the 

Secretary, and at the Commission’s 

Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

forth in sections A, B, and C below, of 

the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend its 

Fee Schedule applicable to its equities 

trading platform (‘‘BYX Equities’’) by 

modifying the rate associated with fee 

code AU in securities priced at or above 

$1.00. The Exchange proposes to 

implement these changes effective 

February 1, 2024. 

The Exchange first notes that it 

operates in a highly competitive market 

in which market participants can 

readily direct order flow to competing 

venues if they deem fee levels at a 

particular venue to be excessive or 

incentives to be insufficient. More 

specifically, the Exchange is only one of 

16 registered equities exchanges, as well 

as a number of alternative trading 

systems and other off-exchange venues 

that do not have similar self-regulatory 

responsibilities under the Securities 

Exchange Act of 1934 (the ‘‘Act’’), to 

which market participants may direct 

their order flow. Based on publicly 

available information,3 no single 

registered equities exchange has more 

than 13% of the market share. Thus, in 

such a low-concentrated and highly 

competitive market, no single equities 

exchange possesses significant pricing 

power in the execution of order flow. 

The Exchange in particular operates a 

‘‘Taker-Maker’’ model whereby it pays 

credits to members that remove 

liquidity and assesses fees to those that 

add liquidity. The Exchange’s Fee 

Schedule sets forth the standard rebates 

and rates applied per share for orders 

that remove and provide liquidity, 

respectively. Currently, for orders in 

securities priced at or above $1.00, the 

Exchange provides a standard rebate of 

$0.00200 per share for orders that 

remove liquidity and assesses a fee of 

$0.00200 per share for orders that add 

liquidity.4 For orders in securities 

priced below $1.00, the Exchange does 

not assess any fees for orders that add 

liquidity, and provides a rebate in the 

amount of 0.10% of the total dollar 

value for orders that remove liquidity.5


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11892 Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 / Notices 

6See Rule 11.25(b)(1). A ‘‘Periodic Auction Only 

Order’’ is a non-displayed limit order entered with 

an instruction to participate solely in Periodic 

Auctions pursuant to Rule 11.25. Periodic Auction 

Only Orders are not eligible for execution on the 

Continuous Book. 

7See Rule 11.25(b)(2). A ‘‘Periodic Auction 

Eligible Order’’ is a non-displayed limit order 

eligible to trade on the Continuous Book that is 

entered with an instruction to also initiate a 

Periodic Auction, if possible, pursuant to Rule 

11.25. 

8A Periodic Auction is a price forming auction 

that is executed at the price level which maximizes 

the total number of shares in both the auction book 

and the continuous market that are executed in the 

auction and does not interrupt trading on the 

continuous market. See Securities Exchange Act 

Release No. 91423 (March 26, 2021), 86 FR 17230 

(April 1, 2021) (SR–CboeBYX–2020–021) (‘‘Periodic 

Auction Filing’’). See also Securities Exchange Act 

Release No. 94012 (January 20, 2022), 87 FR 4060 

(January 26, 2022) (SR-CboeBYX–2021–024) 

(‘‘Periodic Auction Amendment’’). 

9See Rule 1.5(n). The term ‘‘Member’’ shall mean 

any registered broker or dealer that has been 

admitted to membership in the Exchange. 

10See BYX Equities Fee Schedule, Standard 

Rates. See also BYX Equities Fee Schedule, Fee 

Codes and Associated Fees. 

11 15 U.S.C. 78f(b). 

12 15 U.S.C. 78f(b)(5). 

13 Id. 

14 15 U.S.C. 78f(b)(4) 

15See, e.g. EDGA Equity Fee Schedule, Fee Codes 

B, V, and Y. 

Additionally, in response to the 

competitive environment, the Exchange 

also offers tiered pricing which provides 

Members opportunities to qualify for 

higher rebates or reduced fees where 

certain volume criteria and thresholds 

are met. Tiered pricing provides an 

incremental incentive for Members to 

strive for higher tier levels, which 

provides increasingly higher benefits or 

discounts for satisfying increasingly 

more stringent criteria. 

Fee Code AU 

The Exchange currently offers fee 

code AU, which is appended to Periodic 

Auction Only 6 or Periodic Auction 

Eligible 7 orders that are executed in a 

Periodic Auction.8 Currently, the 

Exchange does not assess a fee or 

provide a rebate for any orders 

appended with fee code AU. Now, the 

Exchange proposes to modify the rate 

associated with fee code AU in 

securities priced at or above $1.00. The 

Exchange proposes to assess a fee of 

$0.00040 per share in securities priced 

at or above $1.00 for orders appended 

with fee code AU. The Exchange does 

not propose to implement a fee for 

securities appended with fee code AU 

in securities priced below $1.00. The 

purpose of introducing a fee associated 

with fee code AU in securities priced at 

or above $1.00 is for business and 

competitive reasons, as the Exchange 

has seen increased participation in 

Periodic Auctions and now seeks to 

implement a fee for Members 9 who 

choose to add liquidity designed to 

participate in a Periodic Auction. The 

Exchange notes that while it is adding 

a modest fee for securities priced at or 

above $1.00 appended with fee code 

AU, the fee remains lower than many of 

the fees assessed to liquidity-adding 

orders on the Exchange.10

2. Statutory Basis 

The Exchange believes the proposed 

rule change is consistent with the Act 

and the rules and regulations 

thereunder applicable to the Exchange 

and, in particular, the requirements of 

Section 6(b) of the Act.11 Specifically, 

the Exchange believes the proposed rule 

change is consistent with the Section 

6(b)(5) 12 requirements that the rules of 

an exchange be designed to prevent 

fraudulent and manipulative acts and 

practices, to promote just and equitable 

principles of trade, to foster cooperation 

and coordination with persons engaged 

in regulating, clearing, settling, 

processing information with respect to, 

and facilitating transactions in 

securities, to remove impediments to 

and perfect the mechanism of a free and 

open market and a national market 

system, and, in general, to protect 

investors and the public interest. 

Additionally, the Exchange believes the 

proposed rule change is consistent with 

the Section 6(b)(5) 13 requirement that 

the rules of an exchange not be designed 

to permit unfair discrimination between 

customers, issuers, brokers, or dealers as 

well as Section 6(b)(4) 14 as it is 

designed to provide for the equitable 

allocation of reasonable dues, fees and 

other charges among its Members and 

other persons using its facilities. 

As described above, the Exchange 

operates in a highly competitive market 

in which market participants can 

readily direct order flow to competing 

venues if they deem fee levels at a 

particular venue to be excessive or 

incentives to be insufficient. The 

Exchange believes the proposed 

amendment to the fee associated with 

fee code AU is reasonable as it does not 

represent a significant departure from 

the Exchange’s general pricing structure. 

The Exchange notes that the proposed 

amendment to the fee associated with 

fee code AU represents a modest 

increase over existing prices and yet the 

proposed fee is lower than other similar 

fees assessed to orders that add liquidity 

to the BYX Book.15 In addition, the 

Exchange believes the proposed 

amendment represents an equitable 

allocation of fees and rebates and is not 

unfairly discriminatory because the fees 

will apply to all Members who add 

liquidity by submitting Periodic 

Auction Only or Periodic Auction 

Eligible orders, equally. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. Rather, as 

discussed above, the Exchange believes 

that the proposed change would 

encourage the submission of additional 

order flow to a public exchange, thereby 

promoting market depth, execution 

incentives and enhanced execution 

opportunities, as well as price discovery 

and transparency for all Members. As a 

result, the Exchange believes that the 

proposed changes further the 

Commission’s goal in adopting 

Regulation NMS of fostering 

competition among orders, which 

promotes ‘‘more efficient pricing of 

individual stocks for all types of orders, 

large and small.’’ 

The Exchange believes the proposed 

rule changes do not impose any burden 

on intramarket competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

proposed fees associated with fee code 

AU would apply to all Members equally 

in that all Members would be subject to 

the same fee for the execution of a 

Periodic Auction Only or Periodic 

Auction Eligible order during a Periodic 

Auction on the Exchange. Each of the 

Periodic Auction Only and Periodic 

Auction Eligible order types are 

available to all Members on an equal 

and non-discriminatory basis. As a 

result, any Member can decide to use (or 

not use) the Periodic Auction Only or 

Periodic Auction Eligible order type 

based on the benefits provided by such 

order types in potentially avoiding 

unfavorable executions, and the 

associated charge that the Exchange 

proposes to amend. 

Next, the Exchange believes the 

proposed rule changes does not impose 

any burden on intermarket competition 

that is not necessary or appropriate in 

furtherance of the purposes of the Act. 

As previously discussed, the Exchange 

operates in a highly competitive market. 

Members have numerous alternative 

venues that they may participate on and 

direct their order flow, including other 

equities exchanges, off-exchange 

venues, and alternative trading systems. 

Additionally, the Exchange represents a 

small percentage of the overall market. 

Based on publicly available information, 

no single equities exchange has more 


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Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 / Notices 11893 

16Supra note 1. 

17See Securities Exchange Act Release No. 51808 

(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005). 

18NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. 

Cir. 2010) (quoting Securities Exchange Act Release 

No. 59039 (December 2, 2008), 73 FR 74770, 74782– 

83 (December 9, 2008) (SR–NYSEArca-2006–21)). 

19 15 U.S.C. 78s(b)(3)(A). 

20 17 CFR 240.19b–4(f). 

21 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 98869 

(November 6, 2023), 88 FR 77625 (November 13, 

2023) (SR–NYSE–2023–36) (‘‘Notice’’). 

4See Securities Exchange Act Release No. 99161 

(December 13, 2023), 88 FR 87829 (December 19, 

2023). 

than 13% of the market share.16

Therefore, no exchange possesses 

significant pricing power in the 

execution of order flow. Indeed, 

participants can readily choose to send 

their orders to other exchange and offexchange venues if they deem fee levels 

at those other venues to be more 

favorable. Moreover, the Commission 

has repeatedly expressed its preference 

for competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. Specifically, in Regulation 

NMS, the Commission highlighted the 

importance of market forces in 

determining prices and SRO revenues 

and, also, recognized that current 

regulation of the market system ‘‘has 

been remarkably successful in 

promoting market competition in its 

broader forms that are most important to 

investors and listed companies.’’ 17 The 

fact that this market is competitive has 

also long been recognized by the courts. 

In NetCoalition v. Securities and 

Exchange Commission, the D.C. Circuit 

stated as follows: ‘‘[n]o one disputes 

that competition for order flow is 

‘fierce.’ . . . As the SEC explained, ‘[i]n 

the U.S. national market system, buyers 

and sellers of securities, and the brokerdealers that act as their order-routing 

agents, have a wide range of choices of 

where to route orders for execution’; 

[and] ‘no exchange can afford to take its 

market share percentages for granted’ 

because ‘no exchange possesses a 

monopoly, regulatory or otherwise, in 

the execution of order flow from broker 

dealers’ . . . .’’.18 Accordingly, the 

Exchange does not believe its proposed 

fee change imposes any burden on 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

The Exchange neither solicited nor 

received comments on the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 19(b)(3)(A) 

of the Act 19 and paragraph (f) of Rule 

19b–4 20 thereunder. At any time within 

60 days of the filing of the proposed rule 

change, the Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission will institute proceedings 

to determine whether the proposed rule 

change should be approved or 

disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

comment form (https://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

CboeBYX–2024–005 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street NE, 

Washington, DC 20549–1090. 

All submissions should refer to file 

number SR–CboeBYX–2024–005. This 

file number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

internet website (https://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. Copies of the filing also 

will be available for inspection and 

copying at the principal office of the 

Exchange. Do not include personal 

identifiable information in submissions; 

you should submit only information 

that you wish to make available 

publicly. We may redact in part or 

withhold entirely from publication 

submitted material that is obscene or 

subject to copyright protection. All 

submissions should refer to file number 

SR–CboeBYX–2024–005 and should be 

submitted on or before March 7, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.21

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–03098 Filed 2–14–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–99511; File No. SR–NYSE– 

2023–36] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Order 

Instituting Proceedings To Determine 

Whether To Approve or Disapprove a 

Proposed Rule Change Regarding 

Enhancements to Its DMM Program 

February 9, 2024. 

I. Introduction 

On October 23, 2023, New York Stock 

Exchange LLC (‘‘NYSE’’ or ‘‘Exchange’’) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’), pursuant 

to Section 19(b)(1) of the Securities 

Exchange Act of 1934 (‘‘Act’’) 1 and Rule 

19b–4 thereunder,2 a proposed rule 

change to amend its Designated Market 

Maker (‘‘DMM’’) program. The proposed 

rule change was published for comment 

in the Federal Register on November 13, 

2023.3

On December 13, 2023, the 

Commission extended to February 11, 

2024, the time period in which to 

approve the proposal, disapprove the 

proposal, or institute proceedings to 

determine whether to approve or 

disapprove the proposal.4 The 

Commission has received one comment 


khammond on DSKJM1Z7X2PROD with NOTICES